FormulaDen.com

Physics Chemistry Math Chemical Engineering Civil Electrical Electronics Electronics and Instrumentation Materials Science Mechanical Production Engineering Financial Health

Purchase Price Variance Formula

Fx Copy

LaTeX Copy

Purchase Price Variance is the difference between the actual cost paid for materials or goods and the standard or budgeted cost, multiplied by the actual quantity purchased. Check FAQs

PPV = (ACI - SC) \cdot ACQ

PPV - Purchase Price Variance?ACI - Actual Cost Incurred?SC - Standard Cost?ACQ - Actual Quantity?

Purchase Price Variance Example

With values

With units

Only example

Here is how the Purchase Price Variance equation looks like with Values.

Here is how the Purchase Price Variance equation looks like with Units.

Here is how the Purchase Price Variance equation looks like.

2280 = (254 - 230) \cdot 95

2280 = (254 - 230) \cdot 95

2280 = (254 - 230) \cdot 95

Tip: Use pencil ( Pencil

) icon above to edit Input Values and Units.

Calculate

Recalculate

Solution

Copy

Reset

You are here -

Home » Category

Financial » Category

Cost Accounting » fx Purchase Price Variance

Purchase Price Variance Solution

Follow our step by step solution on how to calculate Purchase Price Variance?

FIRST Step Consider the formula

PPV = (ACI - SC) \cdot ACQ

Next Step Substitute values of Variables

∴

PPV = (254 - 230) \cdot 95

Next Step Prepare to Evaluate

∴

PPV = (254 - 230) \cdot 95

LAST Step Evaluate

∴

PPV = 2280

Purchase Price Variance Formula Elements

Variables

Purchase Price Variance

Purchase Price Variance is the difference between the actual cost paid for materials or goods and the standard or budgeted cost, multiplied by the actual quantity purchased.

Symbol: PPV

Measurement: NAUnit: Unitless

Note: Value should be greater than 0.

Formulas to find Purchase Price Variance

Actual Cost Incurred

Actual Cost Incurred refers to the total expenditure or expenses that have been actually accrued by a business for a particular activity, project, or period.

Symbol: ACI

Measurement: NAUnit: Unitless

Note: Value should be greater than 0.

Formulas to find Actual Cost Incurred

Standard Cost

Standard Cost is the predetermined or estimated cost that a business expects to incur for producing a unit of product or delivering a service, based on standard pricing and efficiency levels.

Symbol: SC

Measurement: NAUnit: Unitless

Note: Value should be greater than 0.

Formulas to find Standard Cost

Actual Quantity

Actual Quantity refers to the real amount or volume of a specific item, material, product, or resource used, consumed, produced, or acquired within a certain timeframe.

Symbol: ACQ

Measurement: NAUnit: Unitless

Note: Value should be greater than 0.

Formulas to find Actual Quantity

Other formulas in Cost Accounting category

Go Material Cost Variance

MCV = (SQAO \cdot STP) - (ACQ \cdot ACP)

Go Material Price Variance

MPRV = ACQ \cdot (STP - ACP)

Go Material Quantity

MQ = STP \cdot (SQ - ACQ)

Go Revised Standard Quantity

RSTQ = (\frac{SQM}{TSQ}) \cdot TAQ

How to Evaluate Purchase Price Variance?

Purchase Price Variance evaluator uses Purchase Price Variance = (Actual Cost Incurred-Standard Cost)*Actual Quantity to evaluate the Purchase Price Variance, The Purchase Price Variance is the difference between the actual cost of acquiring goods or materials and the standard or budgeted cost, indicating the impact of price fluctuations on procurement expenses. Purchase Price Variance is denoted by PPV symbol.

How to evaluate Purchase Price Variance using this online evaluator? To use this online evaluator for Purchase Price Variance, enter Actual Cost Incurred (ACI), Standard Cost (SC) & Actual Quantity (ACQ) and hit the calculate button.

FAQs on Purchase Price Variance

What is the formula to find Purchase Price Variance?

The formula of Purchase Price Variance is expressed as Purchase Price Variance = (Actual Cost Incurred-Standard Cost)*Actual Quantity. Here is an example- 2280 = (254-230)*95.

How to calculate Purchase Price Variance?

With Actual Cost Incurred (ACI), Standard Cost (SC) & Actual Quantity (ACQ) we can find Purchase Price Variance using the formula - Purchase Price Variance = (Actual Cost Incurred-Standard Cost)*Actual Quantity.

Let Others Know

✖

Facebook

Twitter

Copied!

: Value
: Unit

Purchase Price Variance Formula

Purchase Price Variance Example

Purchase Price Variance Solution

Purchase Price Variance Formula Elements

Other formulas in Cost Accounting category

How to Evaluate Purchase Price Variance?

FAQs on Purchase Price Variance

Variable Name